Common Stock Purchase Agreement - Immune Response Corp. and Agouron Pharmaceuticals Inc.
COMMON STOCK PURCHASE AGREEMENT
This Common Stock Purchase Agreement ("Agreement") is made and entered into
as of June 11, 1998 by and between THE IMMUNE RESPONSE CORPORATION., a Delaware
corporation (hereinafter referred to as the Company) and AGOURON
PHARMACEUTICALS, INC., a California corporation ("Agouron"), which parties
hereby agree as follows:
1. AUTHORIZATION; COMMITMENT; CLOSING
1.01 AUTHORIZATION. The Company proposes to authorize, issue and sell to
Agouron on or before January 15, 2000, certain amounts of its common stock,
$.0025 par value ("Common Stock"), as described and determined below.
1.02 COMMITMENT. Subject to Paragraph 5.06 and the terms and conditions
hereof and on the basis of the representations and warranties hereinafter set
forth, the Company agrees to issue and sell to Agouron, and Agouron agree to
purchase from the Company as of the dates and for the consideration set forth
below, the number of shares of the Company's Common Stock as determined below.
The Common Stock which Agouron is acquiring pursuant to the terms of this
Agreement is hereinafter referred to as "Restricted Common Stock". Agouron is
hereinafter sometimes referred to as the "Purchaser." The purchases of the
Common Stock shall occur on the seven purchase dates set forth below. On each
purchase date, Agouron shall be entitled to acquire such number of shares of
Restricted Common Stock (rounded up to the nearest whole share) as may be
purchased for $2,000,000, at a purchase price equal to the stated premium set
forth opposite the applicable purchase date, over the then fair market value
("FMV") of the Common Stock on The NASDAQ Stock Market. FMV shall be defined
as the average closing price of the Common Stock on The NASDAQ Stock Market for
the five (5) trading days immediately preceding the referenced purchase date.
In the event the FMV is "***" on any purchase date, the premium applicable to
such purchase date shall be adjusted to "***."
<CAPTION>
PURCHASE DATE PURCHASE PRICE ***
---------------- -------------- ---
June 11, 1998 $2,000,000 ***
October 15, 1998 $2,000,000 ***
January 15, 1999 $2,000,000 ***
April 15, 1999 $2,000,000 ***
July 15, 1999 $2,000,000 ***
October 15, 1999 $2,000,000 ***
January 15, 2000 $2,000,000 ***
1.03 CLOSING. Separate closings of the purchase and sale of the
Restricted Common Stock ("Closings") shall occur on each of the purchase dates
set forth above and shall take place at such time and place as the Company and
Purchaser shall agree. At each Closing the Company shall deliver to Purchaser
the number of shares of
*** Confidential treatment requested. Sections of text which have been
omitted and for which confidential treatment is requested are noted with
"***". An unredacted version of this document has been filed separately
with the Securities and Exchange Commission.
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June 11, 1998
Restricted Common Stock required by Paragraph 1.02, above, upon delivery to
the Company by Purchaser of a certified check or wire transfer of funds in
the amount of $2,000,000. The Restricted Common Stock to be delivered to
Agouron hereunder at each Closing will be evidenced by a single certificate
registered in Agouron's name or in the name of such nominee as Agouron may
specify and, when issued in accordance with the terms of this Agreement for
the consideration expressed herein, will be duly authorized, validly issued,
fully paid, nonassessable and free and clear of any liens or encumbrances
caused or created by the Company (except that such Restricted Common Stock of
the Company will be subject to restrictions on transfer under federal and
applicable state securities laws).
2. REPRESENTATIONS
2.01 REPRESENTATIONS OF THE COMPANY. The Company represents and warrants
as follows:
(a) The Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and has
all requisite power and authority which are necessary to own and
operate its business and properties and to carry on its business as
it is being conducted. The Company is duly licensed and qualified
and in good standing in the State of California and in such other
jurisdictions in which the ownership or lease of property or the
conduct of its business makes such licensing or qualification
necessary.
(b) There are no proceedings pending or, to the knowledge of the
Company, threatened against or affecting the Company in any court or
before any governmental authority or agency or arbitration board or
tribunal which involve the possibility of materially and adversely
affecting the properties, business, prospects or condition (financial
or otherwise) of the Company.
(c) The issuance and sale of the Restricted Common Stock and
compliance by the Company with all of the provisions of this
Agreement are within the corporate powers of the Company and have
been duly authorized by all proper corporate action on the part of
the Company and will not (i) conflict with or result in any breach of
any of the terms, conditions or provisions of, or constitute a
default under the Articles of Incorporation of the Company or the
Bylaws of the Company, (ii) conflict with or result in any breach of
any of the terms, conditions or provisions of, or constitute a
default under or give any party the right to terminate or accelerate
performance under any other agreement or instrument to which the
Company is a party (iii) require consent under any other contract to
which the Company is a party, (iv) result in the creation or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company pursuant to the terms of any other contract to
which the Company is a party or (v) conflict with any provision of
any applicable
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June 11, 1998
judgment, decree, order, statute, rule, or regulation of any court
or any public, governmental or regulatory agency or body having
jurisdiction over the Company.
(d) This Agreement is a valid and binding agreement of the Company
and is enforceable against the Company in accordance with the terms
hereof, except as such enforceability may be affected by applicable
bankruptcy laws and equitable remedies.
(e) The authorized capital stock of the Company consists of
5,000,000 shares of preferred stock (preferred stock) and 40,000,000
shares of common stock. As of the date hereof, 200 shares of its
Series F Convertible Preferred Stock are outstanding. This preferred
stock is convertible into common stock initially at a conversion
price equivalent to $14.07 per share of common stock. If the
Company's common stock does not trade at prices higher than $14.07
per share over a period of time, the conversion price will be
adjusted downward on April 24, 1999 (or sooner if the Company issues
common stock at less than $14.07 per share) and quarterly thereafter.
As of June 9, 1998, 22,900,350 shares of voting common stock are
outstanding. As of the date hereof, 4,497,749 stock options issued
pursuant to the Company's stock option plans and two (2) warrants to
purchase a total of 2,051,281 shares of voting stock are outstanding.
Up to 6,180,000 shares of common stock may be issued under the
Company's stock option plans. Except as set forth above, there are
no other options, warrants, conversion privileges, preemptive rights,
or rights of first refusal granted by the Company in favor of any
other person presently outstanding or in existence to purchase or
acquire any of the authorized but unissued Common Stock of the
Company, other than any of such items granted pursuant to this
Agreement. The Company has provided to Purchaser copies of its
currently in effect Articles of Incorporation and Bylaws, its Form 10-
K for the year ended December 31, 1997, its 1997 Annual Report, its
Proxy statement dated April 27, 1998 and its Form 10-Q for the
quarter ended March 31, 1998. The Company warrants that the
information contained in such documents as updated and supplemented
prior to the date of the Closing is true and correct and when taken
as a whole does not omit a fact necessary to make the information
contained therein in light of the circumstance under which the
documents were made (taking into account, without limitation, the
type of transaction contemplated by this Agreement and the
sophistication and nature of the Purchaser), not misleading. The
Company acknowledges that the Purchaser is relying on the written
documentation provided by the Company to Purchaser as described above
in making its decision to purchase the Restricted Common Stock.
(f) Since March 31, 1998, except for the sale of 200 shares of
Series F Convertible Preferred Stock for $10 million, there has not
been any change in the assets, liabilities, financial condition or
operations of the Company
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June 11, 1998
other than changes in the ordinary course of business, none of
which individually or in the aggregate have had a material adverse
affect on such assets, liabilities, financial condition or
operations of the Company.
2.02 REPRESENTATIONS OF THE PURCHASER. The Purchaser represents and
warrants as follows:
(a) It is the intent of the Purchaser that its purchase of the
Restricted Common Stock contemplated by this Agreement shall
constitute a transaction exempt from registration under the
Securities Act of 1933, as amended (the "Securities Act") and any
applicable state securities laws.
(b) Purchaser will not offer or sell any Restricted Common Stock
except pursuant to an effective registration statement under the
Securities Act or in transactions which do not require registration
under the Securities Act.
(c) Purchaser is a corporation duly organized and validly existing
under the laws of the State of California is in good standing under
such laws and has all requisite corporate powers and authority to
enter into this Agreement.
(d) On or prior to the date of the initial Closing, Purchaser will
have taken all action necessary for the authorization, execution,
delivery and performance of this Agreement.
(e) Purchaser has (i) reviewed this Agreement, and the written
statements, and documents, delivered to Purchaser as described in
Section 2.01(e); and, (ii) received satisfactory response from the
Company as to matters about which Purchaser has inquired relating to
this Agreement, and other documents described in Section 2.01(e) and
relating to the Company's business condition, prospects and plans as
necessary to evaluate the merits and risks of acquiring the
Restricted Common Stock. Purchaser has informed the Company that
Purchaser is relying on all such information and documents in making
its decision to purchase the Restricted Common Stock.
(f) Purchaser (i) has had the risks involved in the investment
represented by this Agreement explained; (ii) has knowledge and
experience in financial and business matters to evaluate the merits
and risks of the investment represented by this Agreement; (iii) is
able to bear the economic risk of the investment represented by this
Agreement (including a complete loss of this investment); and (iv)
has determined that this investment is suitable for Purchaser in
light of Purchaser's financial circumstances and available investment
opportunities.
(g) Purchaser is acquiring the Restricted Common Stock for its own
account and with its general assets for the purpose of investment and
not
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June 11, 1998
with a view to the resale, transfer or distribution thereof, and
has no present intention of selling, transferring, negotiating or
otherwise disposing of any Restricted Common Stock. Notwithstanding
anything in this Agreement to the contrary, it is agreed that the
Purchaser shall have the right to assign or transfer the Restricted
Common Stock to its Affiliates at any time without the consent of the
Company.
3. NON-DISCLOSURE. Except as agreed to by the parties neither the Company nor
the Purchaser shall release any information to any third party with respect to
any of the terms of this Agreement without the prior written consent of the
other, which consent shall not unreasonably be withheld. This prohibition
includes, but is not limited to, press releases, promotional materials and
discussions with the media. If the Company determines that it is required by
law to release information to any third party regarding the terms of this
Agreement, it shall notify the Purchaser of this fact prior to releasing the
information. The notice to the Purchaser shall include the text of the
information proposed for release. The Purchaser shall have the right to confer
with the Company regarding the necessity for the disclosure and the text of the
information proposed for release.
4. COMPLIANCE WITH SECURITIES ACT
4.01 CERTAIN DEFINITIONS. As used herein, the following terms shall have
the following respective meanings:
(a) COMMISSION. Shall mean the Securities and Exchange Commission,
or any other Federal agency at the time administering the Securities
Act or the Trust Indenture Act, as the case may be.
(b) SECURITIES ACT. Shall mean the Securities Act of 1933, as
amended, or any similar Federal statute, and the rules and
regulations of the Commission thereunder, all as the same shall be in
effect at the relevant time.
(c) EXCHANGE ACT. Shall mean the Securities Exchange Act of 1934,
as amended, or any similar Federal statute, and the rules and
regulations of the Commission thereunder, all as the same shall be in
effect at the relevant time.
(d) RESTRICTED COMMON STOCK. Shall mean the Common Stock of
the Company issued and sold pursuant to this Agreement which by the
terms hereof is required to bear the legend specified in Section 4.02
hereof.
4.02 RESTRICTION OF TRANSFERABILITY; LEGEND. Shares of Restricted Common
Stock shall not be resold or transferred unless registered under the Securities
Act or unless an exemption from registration is available for such sale or
transfer. The conditions specified below are intended to ensure compliance
with the provisions of the Securities Act in respect of any transfer of stock.
Each certificate for shares of Restricted
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Common Stock shall be stamped or otherwise imprinted with a legend in
substantially the following form:
The shares evidenced by this certificate have not been
registered under the Securities Act of 1933, as
amended, and may not be sold or transferred in the
absence of such registration or an exemption therefrom
under said Securities Act and the transfer of such
shares is subject to terms and conditions specified in
the Common Stock Purchase Agreement dated as of June
11, 1998, between the Company and Agouron
Pharmaceuticals, Inc.
If shares of Restricted Common Stock evidenced by certificates bearing a legend
required by this Section 4.02 are sold in accordance with a registration
statement which has become effective under the Securities Act, or if the
Company shall receive an opinion of its counsel to the effect that any legend
required under this Section 4.02 is not, or is no longer, necessary or required
with respect to such shares (including, without limitation, because of the
availability of the exemption afforded by Rule 144 of the General Rules and
Regulations of the Commission), the Company shall, or shall instruct its
transfer agent and registrar to, remove such legend or issue new certificates
without such legend in lieu thereof.
4.03 INFORMATION REQUIREMENTS. The Company agrees to:
(a) Make and keep public information available, as such term is
understood and defined in Commission Rule 144 and Rule 144A, under
the Securities Act;
(b) Use its best efforts to file with the Commission in a timely
manner all reports and other documents required of the Company under
the Securities Act and the Exchange Act; and
(c) Furnish to any holder of Restricted Common Stock a copy of the
most recent annual or quarterly report of the Company, and such other
publicly available reports and documents of the Company, so that such
holder may avail itself of any rule or regulation of the Commission
allowing it to sell any such securities without registration.
4.04 PIGGY-BACK REGISTRATION RIGHTS. If the Company before January 15,
2001 contemplates a public offering of shares of its Common Stock to be
registered under the Securities Act, the Company shall so notify the Purchaser
in writing of its intention to do so, at least twenty (20) days prior to the
filing of a registration statement for such offering. If Purchaser gives
written notice to the Company, within ten (10) days of receipt of the notice
from the Company, of Purchaser's desire to have its Restricted Common Stock
included in such
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June 11, 1998
registration statement, Purchaser may, subject to the provisions of this
Section 4.04, have its Restricted Common Stock included in such registration
statement. The Company shall bear all expenses in connection with the
registration and sale of any such Restricted Common Stock, other than the
fees or disbursements of any special counsel which the Purchaser may retain
in connection with the registration of its Restricted Common Stock or any
portion of the underwriter's commission, discounts and expenses attributable
to the Restricted Common Stock being offered and sold by the Purchaser.
Notwithstanding the foregoing, if the managing underwriter of any such
offering determines that the number of shares proposed to be sold by the
Company, by other shareholders having piggy-back rights, and/or by the
Purchaser is greater than the number of shares which the underwriter believes
feasible to sell at the time, at the price and upon the terms approved by the
Company, then the number of shares which the underwriter believes may be sold
shall be allocated for inclusion in the registration statement in the
following order of priority: (i) shares being offered by the Company; and
(ii) pro rata among the other shareholders and the Purchaser, based on the
number of shares of Common Stock each shareholder requested to be registered.
The Company shall have the right to designate the managing underwriter in
respect of a public offering pursuant to this Section 4.04.
4.05 ADDITIONAL COVENANTS CONCERNING SALE OF SHARES.
(a) The Company will notify the Purchaser of the effectiveness of
any registration statement in which Purchaser has exercised
registration rights granted pursuant to the terms of Section 4.04,
together with a list of the jurisdictions where the Company has
qualified or is exempt from registration under applicable state
securities laws.
(b) The Company will prepare and file with the Commission such
amendments and supplements to any registration statement filed
pursuant to the terms of Section 4.04 (and any prospectus used in
connection with such registration statement) as may be necessary to
comply with the provisions of the Securities Act with respect to the
sale of Restricted Common Stock by the Purchaser.
(c) The Company will furnish to the Purchaser a reasonable number of
copies of the prospectus used in connection with a registration
statement filed pursuant to the terms of Section 4.04, including a
preliminary prospectus, which prospectus conforms to the requirements
of the Securities Act, and such other documents as the Purchaser may
reasonably request, in order to facilitate the disposition of the
Purchaser's Restricted Common Stock.
(d) In connection with any registration statement referred to in
Section 4.04 of this Agreement, Purchaser will furnish to the
Company such information as the Company may reasonably require from
Purchaser for inclusion in the registration statement (and the
prospectus included therein).
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June 11, 1998
(e) The Company's obligations under Section 4.04 shall be
conditioned upon Purchaser executing and delivering to the Company
its agreement, in a form satisfactory to counsel for the Company,
that it will comply with all applicable provisions of the Securities
Act, the Exchange Act, the securities acts of applicable states and
any rules and regulations promulgated under such acts and will
furnish to the Company information about sales made in such public
offering.
4.06 INDEMNIFICATION
In the event any of the Restricted Common Stock of Purchaser is included
in a registration statement under Section 4.04 of this Agreement:
(a) To the extent permitted by law, the Company will indemnify and
hold harmless the Purchaser and its Affiliates and their respective
officers, directors and employees, against any losses, claims,
damages, or liabilities (joint or several) to which they may become
subject under the Securities Act, the Exchange Act or other federal
or state law, insofar as such losses, claims, damages, or liabilities
(or actions in respect thereof) arise out of or are based upon any of
the following statements, omissions or violations (hereinafter
sometimes collectively referred to as a "Violation(s)"): (i) any
untrue statement or alleged untrue statement of a material fact
contained in such registration statement, including any preliminary
prospectus or final prospectus contained therein or any amendments or
supplements thereto; (ii) the omission or alleged omission to state
therein a material fact required to be stated therein, or necessary
to make the statements therein not misleading; or (iii) any violation
or alleged violation by the Company of the Securities Act, the
Exchange Act, any state securities law or any rule or regulation
promulgated under the Securities Act, the Exchange Act or any state
securities law; and the Company will reimburse each such indemnified
party for any legal or other expenses reasonably incurred by it in
connection with investigating or defending any such loss, claim,
damage, liability or action; provided, however, that the indemnity
agreement contained in this Section 4.06 shall not apply to amounts
paid in settlement of any such loss, claim, damage, liability or
action if such settlement is effected without the consent of the
Company (which consent shall not be unreasonably withheld or
delayed), nor shall the Company be liable in any such case for any
such loss, claim, damage, liability or action to the extent that it
arises out of or is based upon a Violation which occurs in reliance
upon, and in conformity with, written information furnished expressly
for use in connection with such registration, by any such indemnified
party.
(b) To the extent permitted by law, the Purchaser will indemnify and
hold harmless the Company and its Affiliates and their respective
officers, directors and employees against any losses, claims,
damages, or liabilities (joint or several) to which they may become
subject under the Securities
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Act, the Exchange Act or other federal or state law, insofar as
such losses, claims, damages, or liabilities (or actions in respect
thereof) arise out of or are based upon any Violations, in each
case to the extent (and only to the extent) that such Violation
occurs in reliance upon, and in conformity with, written
information furnished by the Purchaser and its Affiliates and their
respective officers, directors and employees to the Company
expressly for use in connection with such registration; and the
Purchaser will reimburse each such indemnified party for any legal
or other expenses reasonably incurred by it in connection with
investigating or defending any such loss, claim, damage, liability
or action; provided, however, that the indemnity agreement
contained in this Section 4.06 shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if
such settlement is effected without the consent of the Purchaser,
which consent shall not be unreasonably withheld or delayed.
(c) Promptly after receipt by an indemnified party under this
Section 4.06 of notice of the commencement of any action (including
any governmental action), such indemnified party will, if a claim in
respect thereof is to be made against the indemnifying party under
this Section 4.06, notify the indemnifying party in writing of the
commencement thereof and the indemnifying party shall have the right
to participate in, and, to the extent the indemnifying party so
desires, to assume the defense thereof with counsel mutually
satisfactory to the parties.
5. MISCELLANEOUS
5.01 EXPENSES; FINDERS FEES. Neither party shall pay expenses and finder
fees for or to the other in connection with this transaction. Each party
agrees to indemnify and hold the other party harmless from any liability for
any commission or compensation in the nature of a finder's fee to any broker or
other person (and the costs and expenses of defending against such liability or
asserted liability) claiming to have been hired or engaged by the party.
5.02 REPLACEMENT OF CERTIFICATES FOR RESTRICTED COMMON STOCK. Upon
receipt by the Company of evidence reasonably satisfactory to it of the loss,
theft, destruction or mutilation of any certificate evidencing any Restricted
Common Stock, the Company will execute, register and deliver, in lieu thereof,
a new certificate for an equal number of shares of Restricted Common Stock. In
the case of loss, theft or destruction of a certificate, at the election of the
Company, the Purchaser may be required to provide an indemnity reasonably
satisfactory to the Company or to post a surety bond in an amount equal to the
value of the shares represented by the new certificate.
5.03 NOTICE. Any notice required to be given under the terms of this
Agreement shall be in writing, and shall be given in person, transmitted by
telecopier, e-mail or similar electronic communication, delivered by a
recognized overnight delivery service such as Federal Express or sent by mail
(certified or registered or air mail for addresses
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outside of the country of origin), return receipt requested, postage prepaid
and addressed to the Company at 5935 Darwin Court, Carlsbad, California
92008, or such other address as the Company may designate to Purchaser in
writing and to the Purchaser, at the address appearing at the beginning of
this Agreement or such other address as Purchaser may designate to the
Company in writing. Except as otherwise provided herein, any notice so given
shall be deemed delivered upon the earlier of (i) actual receipt; (ii)
receipt by sender of confirmation if telecopied or sent by e-mail or similar
electronic communication; (iii) two business days after delivery to such
overnight delivery service; or (iv) five business days after deposit in the
mail.
5.04 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
parties and their respective successors and assigns.
5.05 SURVIVAL OF REPRESENTATIONS, ETC. All covenants, representations and
warranties made by the parties herein shall survive the Closings and the
delivery of this Agreement and the shares of Restricted Common Stock purchased
hereunder.
5.06 TERMINATION. Purchaser's obligation to purchase Restricted Common
Stock under this Agreement shall terminate with respect to any purchase
obligations whose purchase dates under Paragraph 1.02 occur after Purchaser has
elected to terminate, in its entirety, all of Purchaser's rights and
obligations under the Letter of Intent ("LOI") dated June 11, 1998 and the
Definitive Agreement (as defined in the LOI) between the parties.
5.07 SEVERABILITY. Should any part of this Agreement for any reason be
declared invalid, such decision shall not affect the validity of any remaining
portion, which remaining portion shall remain in force and effect as if this
Agreement had been executed with the invalid portion thereof eliminated and it
is hereby declared the intention of the parties hereto that they would have
executed the remaining portion of this Agreement without including therein any
such part, parts, or portion which may, for any reason, be hereafter declared
invalid.
5.08 GOVERNING LAW. This Agreement shall be construed and enforced in
accordance with, and governed by, the laws of the State of California without
regard to its conflict of law provisions.
5.09 CAPTIONS, FORM OF PRONOUNS. The descriptive headings of the various
sections or parts of this Agreement are for convenience only and shall not
affect the meaning or construction of any of the provisions hereof. All
pronouns used in this Agreement shall be deemed to include masculine, feminine
and neuter forms.
5.10 AGREEMENT IS ENTIRE CONTRACT. This Agreement constitutes the entire
contract between the parties hereto related to the purchase and sale of
Restricted Common Stock and no party shall be liable or bound to the other in
any manner by any warranties, representations or covenants except as
specifically set forth herein.
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5.11 THIRD PARTIES. Nothing in this Agreement is intended to confer upon
any party, other than the parties hereto, and their respective permitted
successors and assigns, any rights, remedies, obligations, or liabilities under
or by reason of this Agreement, except as expressly provided herein.
5.12 AMENDMENT AND WAIVER. Any provision of this Agreement may be amended
and the observance of any term hereof may be waived (either prospectively or
retroactively and either generally or in a particular instance) only with the
written consent of the Company and the Purchaser.
5.13 AFFILIATES. References to Purchaser in this Agreement shall be
deemed to include direct or indirect subsidiaries of Purchaser. The term
"Affiliate" shall have the meaning defined in the LOI.
5.14 DISPUTE RESOLUTION. In the event of any controversy or claim arising
out of or relating to any provision of this Agreement, the parties shall try to
settle their differences amicably between themselves. Any unresolved disputes
arising between the parties relating to, arising out of or in any way connected
with this Agreement or any term or condition hereof, or the performance by
either party of its obligations hereunder, whether before or after termination
of this Agreement, shall be finally resolved by binding arbitration. Whenever
a party shall decide to institute arbitration proceedings, it shall give
written notice to that effect to the other party. The party giving such notice
shall refrain from instituting the arbitration proceedings for a period of
sixty (60) days following such notice The arbitration shall be held in San
Diego, California according to the rules of the American Arbitration
Association ("AAA") applicable to commercial securities matters of this nature.
The arbitration shall be conducted by a panel of three arbitrators appointed in
accordance with AAA rules; provided, however, that each party shall within
thirty (30) days after the institution of the arbitration proceedings appoint
one arbitrator with the third arbitrator being chosen by the other two
arbitrators. If only one party appoints an arbitrator, then such arbitrator
shall be entitled to act as the sole arbitrator to resolve the controversy.
Any arbitration hereunder shall be conducted in the English language and the
arbitrator(s) shall apply the law set forth in Section 5.08. All arbitrator(s)
eligible to conduct the arbitration must agree to render their opinion(s)
within thirty (30) days of the final arbitration hearing. The arbitrator(s)
shall have the authority to grant injunctive relief and specific performance,
and to allocate between the parties the costs of arbitration in such equitable
manner as he determines; provided, however, that each party shall bear its own
costs and attorney's and witness' fees. Notwithstanding the terms of this
Section 5.14, a party shall also have the right to obtain prior to the
arbitrator(s) rendering the arbitration decision, provisional remedies
including injunctive relief or specific performance from a court having
jurisdiction thereof. The arbitrator(s) will, upon the request of either
party, issue a written opinion of the findings of fact and conclusions of law
and shall deliver a copy to each of the parties. Decisions of the
arbitrator(s) shall be final and binding on all of the parties. Judgment on
the award so rendered may be entered in any court having jurisdiction thereof.
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The execution hereof by Purchaser shall constitute a contract between us for
the uses and purposes hereinabove set forth, and this Agreement may be executed
in any number of counterparts, each executed counterpart constituting an
original but all together only one agreement.
THE IMMUNE RESPONSE CORPORATION
By S/DENNIS J. CARLO
-----------------------------------------
By S/CHARLES J. CASHION
-----------------------------------------
ACCEPTED AND AGREED TO AS OF THE DAY AND YEAR AFORESAID.
PURCHASER:
AGOURON PHARMACEUTICALS, INC
By S/PETER JOHNSON
-----------------------------------------
Peter Johnson
President and Chief Executive Officer
By S/GARY FRIEDMAN
-----------------------------------------
Gary Friedman
Secretary
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